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HONG Kong investors are snapping up the Chinese yuan amid widespread expectations that Beijing will soon respond to growing calls to revalue its currency.

The financial centre's banks have seen a spike in currency transactions as speculation continues, with HSBC saying trade in March alone almost doubled from the previous month.

Dealers are rushing for the yuan as Beijing faces pressure to allow it to appreciate, with critics led by the United States saying it is being kept artificially weak - some say by as much as 40 per cent - to boost exports.

Francesca McDonagh, head of personal banking services at HSBC Hong Kong, would not disclose the bank's precise foreign-exchange trading figures, but said the recent surge was "not a tiny amount".

The 90 per cent increase in March was the highest monthly growth rate for the bank since it started yuan transactions in 2004, she added. "This is a very material upside increase from our retail clients," she told AFP

"We see that continuing in April."

Hang Seng Bank has said yuan exchange transactions and yuan deposits recorded double-digit growth in the first quarter, with the trend likely to continue if the currency's value goes higher.

In February, the Hong Kong Monetary Authority, the city's de facto central bank, rolled out a series of measures that allowed banks to expand their yuan business.

The move was part of plan to make Hong Kong an offshore centre for trading in mainland China's currency, with a view to the yuan eventually becoming an international currency.

Beijing had allowed the yuan to appreciate in a narrow band against the greenback until the global financial crisis began in 2008, when it informally pegged it at around 6.8 yuan to the US dollar.

But the United States has called on China's leaders to unshackle the currency amid bitter complaints in Congress that it was being manipulated.

Brazil and India recently joined the calls for revaluation and this month the International Monetary Fund advised China allow an appreciation for its own well-being, saying the undervalued currency was skewing world trade.

As speculation about revaluation mounts, Fubon Bank (Hong Kong) said it plans to roll out yuan-denominated insurance products over the next couple of months with partners China Life Insurance and MetLife.

"We know there is very hot demand for (yuan) denominated products so we're looking probably to offer that in the second quarter," said Harrison Ho, Fubon's first vice-president and head of insurance.

"The market view is that the (yuan) will be increased or appreciate. No one would buy these products if they thought it would not happen."

Despite the speculation China has so far held firm, saying it will not bow to pressure from the United States and describing its currency policy as a domestic matter.

The timing of any revaluation would depend heavily on diplomacy around the hot-button issue, said Grace Ng, an economist at investment bank JP Morgan Chase in Hong Kong.

Ms Ng said she expected China to gradually boost its currency by about four percent over the coming year.

"Pressure from the US is a major factor in determining the exact timing of a revaluation," she told AFP. "The US has been trying to lower the impression that it is pressuring China. That makes it a little easier from the China side."